While the Internet, social media, and technology play a leading role in the growth of an agent’s business, the agent remains a critical component of the business.
Real estate can be dicey, especially if you’re doing it alone. Intelligent agents know the importance of good team structure. That’s why choosing a real estate team structure that works for your business is so important.
A real estate team structure is essential to keep your business moving forward. If you’re not organized and structured, you will have difficulty marketing your business and ensuring your clients are satisfied. A strong team structure can also help you achieve a better work-life balance.
The real estate industry is changing. And agents are changing with it. How does this impact the future of realty? And what do these changes mean for agents?
Real estate teams are becoming more popular than ever, and it’s a great time to set up a new team or expand an existing one. This article will provide information to help you know what works best.
Team Structure in Real Estate
Teams are a fantastic method to maximize resources and time. Understanding the various team arrangements and which deliver results is crucial because not all real estate team structures are effective.
Most real estate teams are in one of the following four models.
The Project Manager
Some agents use a team to assist them. They understand that a strong team can increase the business potential. These team builders know that the team is the best way to harness people’s abilities to serve customers better and advance the company.
The Self-organized Team
Some teams aren’t exactly a team in the traditional sense. Consider this more like a group of salespeople running the business independently without management support.
The Family Team
In this team, everyone is like a very well-known family member. Even though everyone works together, each team member’s role is not clearly defined. The business is typically placed on hold when a family team goes on vacation together.
The Taskmaster
Despite being a master at what they do, the team leader is authoritative. Since the team leader wants things their way, teams of this nature frequently experience burnout. The leader is often challenging to work with and doesn’t get along well with others.
The project manager or team builder is the most likely to succeed because they invest not only in the team’s success but also in their individual members’ growth.
eXp Realty has different models that can help agents grow together as a team and build a self-sustaining business for themselves.
Commissions Split Between Real Estate Teams
Real estate commissions are payments based on a property’s final selling or buying price as specified in the brokerage’s agreement with their real estate agent.
There are several options a team can choose from when dividing commission in the real estate industry—however, the aims and structure of each group influence the commission split. For instance, a team with numerous agents might divide commissions according to who put in the most effort.
The brokerage receives payment, and the money gets divided according to the predetermined contract. This commission fee, according to consensus, is between 5% and 6%.
Real estate teams divide their commissions differently depending on their organizational structure and prospective earnings. The commission split can get up to 80/20 with eXp Realty, but these ratios fluctuate depending on agreements.
Most of the time, the person who puts in the most effort receives a larger commission. Consider your commission before choosing the real estate team structure that will work best for you.
How Agents Benefit From eXp Realty’s Commission Split
eXp offers a hefty 80/20 split until you hit a $16K commission threshold, unlike other brokerages who start their agents out with a 60/40 split. Your income will be yours to keep after you reach $16K. The following 20 transactions, however, will incur a $250 transaction fee. After that, the cost is $75.
In addition, eXp assesses Errors and Omissions (E&O) insurance fees on a per-transaction basis to help agents minimize costs. Until they reach their $500 threshold, agents can pay just $40 for each transaction. eXp also charges a $25 broker review fee to guarantee the validity of all contracts.
Furthermore, agents that sign up with eXp can save a sizable sum of money because the brokerage charges no franchise or royalty fees, cheap beginning costs, and little to no E&O insurance. Savings for agents who earn an $80,000 GCI (Gross Commission Split) can reach $8,000. Top-producing agents selling over 20 properties in a year can save up to $60,000. Agents in this category typically earn a GCI close to $300,000.
Workflow of A Real Estate Team
Working in a real estate team requires collaboration, as it does with any team. To accomplish goals and succeed, the team and the leader work together to support one another.
- There is typically a team leader, and the team leader is in charge of producing the majority of leads and serving as the coach and recruiter.
- The team leader will oversee listing, obtaining recommendations, and completing objectives.
- The team members will assist as the team leader takes charge.
- Clients can get in touch with any team member with queries or concerns. Team members are also in charge of holding open houses and interacting with buyers.
eXp Realty provides many alternatives to organize your team and assist you in developing your business rapidly.
eXp’s innovative model provides agents with the tools to create a “seventh-level business.” Over the past couple of years, the firm has witnessed this materialize, with numerous agents receiving monthly passive revenue.
The Seventh-Level Business Team Model
When you structure your real estate business to function with little to no involvement from you, it has reached the “seventh level.” This structure occurs when you’ve dedicated time to implement efficient methods, expand your workforce, and establish a repeat clientele.
Real estate agents and brokers usually have to work hard to make money. Their job is a numbers game for the more significant part of their career. They’re only as successful as their last closing.
You have to put in long hours, and if you’re not careful, you may end up in a situation where you don’t have enough time to work on any other aspect of your life.
But what about making money while you are asleep? Real estate agents and brokers can earn passive income in real estate, and here’s how a team at eXp Realty can help you achieve that.
The Structure of an eXp Realty Team
At eXp, it is possible to organize your team in various ways.
- Self-sustaining Team
This eXp Realty team structure resembles a partnership for referrals. Most team leaders at eXp begin their careers in this manner.
As a team leader in this model, there is no set number of deals you must close to support your team. Everyone on the team has a $16,000 cap. There is no reduction for team members and the team leader is not subject to a minimum referral requirement.
Additionally, while a team roster is necessary, eXp does not require a legal team agreement. This way, you give eXp a list of the agents with whom you often share transactions. However, there’s no need to include one-time deals on a roster.
Finally, an agent can choose to form a self-organized team so that other agents can use the team leader’s platform to get their business out into the market.
This structure is perfect for agents looking for a lot of freedom in a team. The branding or marketing materials the team leader has access to are also fantastic for agents needing technical advantages. Agents can join this team structure for a nominal referral fee and benefit from the team leader’s facilities.
- Conventional Team
This team structure is similar to other teams you’ll find in any other real estate brokerage or even any other industry. A conventional or standard team comprises team divisions and formal leadership.
Unlike a self-organized team, eXp must accept a legal team agreement before using this model. Team leaders can alter standard team forms from eXp to meet your team’s unique requirements. The team leader must produce a team roster so the firm knows every agent working under the group.
In addition, the team is to use a 75/25 commission split across all deals, and each agent pays a referral fee to the team leader. Also, the team leader must have a $16,000 cap, while team members must have an $8,000 cap each.
Since agents in this team model pay a half cap ($8,000), the team leader is responsible for setting up a sound system for everybody involved in the team’s success.
Finally, to be considered a typical team, you must have concluded 30 transactions in the preceding year or generated $6 million in revenue. This figure applies to 12 months, not a calendar year.
eXp will take individual and overall team output into account when calculating the success of this team structure. The team leader must continue this output level once the team is fully functional.
A broker will join as the team leader and bring other agents on board. Real estate teams use this structure to become part of eXp’s global network.
- Domestic Partnership
Married couples who wish to join eXp have a unique opportunity to form a team. By contacting eXp support, a domestic partnership can be created or ended anytime.
Domestic partnerships get allotted the same $16,000 maximum cap. But people who use this team structure can enjoy a monthly fee discount. They will only pay $85 on their first month with eXp. From the second month, they can start paying $50.
Furthermore, a domestic partnership doesn’t need a written team agreement. All you need for this arrangement is proof of your marriage and to fill out a registration form in the domestic partnership section of your agent registration.
- The Mega Icon Team
This team model is ideal for those who want to form a team of 10 or more agents. The mega icon team offers an opportunity for team leaders to increase their value proposition while assisting their agents in reducing their costs.
Like a legal team, the mega icon team requires both a roster and a documented team agreement. It also requires a referral rate of 25% from the team leader.
A mega icon team must have at least $40 million in closed sales or 175 closed transactions to qualify. It also needs to have had ten members of the capping team within the past 12 months.
Except for the club leader, every agent has a $4,000 cap. The team leader’s hat is still $16,000. No matter how many agents hit their caps, the team is still liable for $56,000 in caps. This system ensures the unit stays productive.
This strategy is effective for agents who prefer working in a team environment and want a high number of sales.
eXp Realty’s Revenue Share
eXp’s revenue share model aims to foster teamwork and a culture of collective growth. Agents that contribute to the expansion of the business get recognized by eXp through revenue sharing.
For the duration of their employment with eXp, agents who sponsor other agents will get a portion of their sponsored agents’ gross commission revenue. It is not an additional cost incurred by the sponsor. Instead, that portion gets deducted from eXp’s share of the split.
Furthermore, when the agents in your team create and expand their teams, your revenue share will also grow. eXp’s team model success can mainly be attributed to revenue sharing.
How To Organize Your Real Estate Team
While there are many methods to organize a team’s activities, the most popular team structure gives each member a position that lets them focus on their most vital skills while still contributing to the whole team’s success.
The team leader handles marketing and generating leads in this kind of organization. Other team members will control transaction coordination and one or more people who get appointed as buyer’s agents.
Large teams, like a mega icon team, may need assistants who take on some of the responsibilities. They help to relieve licensed agents of laborious and time-consuming tasks, such as:
- Taking care of buyer consultations
- Showing homes
- Negotiating agreements
- Setting up inspections
- Make sure all paperwork gets completed correctly
Teams have emerged as a very successful business strategy, even though everyone in real estate begins as a single agent with an individual license. Furthermore, eXp makes it easy to work as a team, especially for new agents.
Pros of A Real Estate Team
Real estate teams are a great way for agents to increase their productivity. But there are some things to consider before you decide to make this change for your business. The following are the pros and cons of working with a real estate team.
Assistance from Your Team
In a real estate team, you will always have the support of every other team member. The support of your team is an invaluable benefit and a collective advantage because you are all working toward the same objective.
The advantages eXp has:
The CRM platform utilized by eXp Realty agents is kvCORE. eXp agents have access to kvCORE as a system-wide individual license. For just $399 per month, a team leader can transform their kvCORE license into a team license and oversee an infinite number of agent accounts.
Additionally, team leaders save a considerable amount of money at eXp. Typically, they would have to budget anywhere from $750 to $2000 a month for a comparable system elsewhere. Your overhead will get significantly reduced, leaving you with more money to spend on other things.
Professional Growth
Belonging to a real estate team can be helpful if you’re a rookie agent because it allows you to learn from seasoned agents. Due to the combined effort, team leaders can gain from the contribution of other team members.
The advantages eXp has:
Every year, agents and team leaders that satisfy the production and cultural standards receive the ICON award. While you can achieve ICON status as a team member, team leaders have an advantage in this situation.
eXp will take the team leader’s split from agents on their team and their productivity into account for the ICON status.
The ICON award is renewable annually, and ICON agents earn their $16,000 cap returned in the form of publicly traded eXp stock.
Education
Keeping up with news and trends is essential in a continually changing field. Joining a real estate team will allow you to learn about the most recent market trends, industry developments, and innovative marketing strategies to help you grow your business.
The advantages eXp has:
In addition to offering a comprehensive training program, eXp helps agents reduce their financial load. The eXp World training teaches the concepts you want your agents to learn.
Rather than spend several weeks or months training each of your agents, you could spend time and money on marketing or production.
Conversion of Leads
Real estate success primarily depends on leads, so it’s essential to understand how to generate them, where to look, and how to keep them. Your team will have a better chance of finding leads that convert to customers if you have several agents on the search.
The advantages eXp has:
The best method to keep a steady flow of high-quality leads flowing is through digital marketing. With the help of our marketing tools, Making It Rain, even agents with limited time or experience can take advantage of the effectiveness of online advertising.
Branding
In an industry like real estate, branding is crucial. It is vital for your company’s long-term viability as well as its early phases of development. Within the confines of state regulations, eXp allows agents to brand themselves however they deem suitable for their firm.
You can promote yourself in a way that highlights your business as an agent since eXp gives you the freedom to manage your branding. You can use this opportunity to create unified marketing plans that customers will recognize and eventually trust.
Cons of a Real Estate Team
Commission Split
Working in a team may mean less money from commission splits. Your commission split may decrease if you work in a large group since your team will need to produce and close more leads and deals than an independent agent. Find a section that explains the commission split and how it benefits you in straightforward terms.
Reduced Control
Working in a team somewhat diminishes your freedom and control as a solo real estate agent. In a team you have to consult your section when you have a new idea to see if everyone is on board.
Unfavorable Team Dynamics
Your real estate team may occasionally have unbalanced dynamics. Certain members of your group may not get along. Stress and undesirable outcomes resulting from negative dynamics may affect the team’s productivity. Due to this, it’s crucial to assess the team’s culture before joining to ensure you’ll fit in.
Difficulty With Personal Branding
In a real estate team, it is the company’s corporate identity—not your own—that you are creating. This fact can make it challenging for you to establish your identity as a brand.
However, eXp Realty has a system that enables agents to thrive as team members and individual real estate agents. The team structures at eXp give agents different choices depending on their personal real estate goals and objectives.
Conclusion
Finding the ideal brokerage will be necessary once you have earned your real estate license. A great option is eXp Realty.
They provide many solid options for agents to conduct business. On top of that, the unique eXp Realty team structure can help you expand your business in remarkable ways and give you the chance to earn passive income in no time.